Range Resources (NYSE: RRC) and Pacific Coast Oil Trust (NYSE:ROYT) are both oils/energy companies, but which is the superior investment? We will compare the two businesses based on the strength of their institutional ownership, earnings, valuation, risk, profitability, analyst recommendations and dividends.

Volatility & Risk

Range Resources has a beta of 0.91, indicating that its share price is 9% less volatile than the S&P 500. Comparatively, Pacific Coast Oil Trust has a beta of 2.15, indicating that its share price is 115% more volatile than the S&P 500.

Analyst Ratings

This is a summary of current recommendations and price targets for Range Resources and Pacific Coast Oil Trust, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Range Resources 1 5 17 0 2.70
Pacific Coast Oil Trust 0 1 0 0 2.00

Range Resources currently has a consensus target price of $32.48, suggesting a potential upside of 86.96%. Pacific Coast Oil Trust has a consensus target price of $1.50, suggesting a potential downside of 10.18%. Given Range Resources’ stronger consensus rating and higher probable upside, equities analysts clearly believe Range Resources is more favorable than Pacific Coast Oil Trust.

Dividends

Range Resources pays an annual dividend of $0.08 per share and has a dividend yield of 0.5%. Pacific Coast Oil Trust pays an annual dividend of $0.15 per share and has a dividend yield of 9.0%. Range Resources pays out -38.1% of its earnings in the form of a dividend. Pacific Coast Oil Trust pays out 375.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future.

Profitability

This table compares Range Resources and Pacific Coast Oil Trust’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Range Resources -2.23% 1.63% 0.79%
Pacific Coast Oil Trust 7.04% 1.43% 1.43%

Institutional & Insider Ownership

94.9% of Range Resources shares are held by institutional investors. Comparatively, 19.6% of Pacific Coast Oil Trust shares are held by institutional investors. 2.4% of Range Resources shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Earnings and Valuation

This table compares Range Resources and Pacific Coast Oil Trust’s top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio NetIncome Earnings Per Share Price/Earnings Ratio
Range Resources $1.10 billion 3.92 -$521.38 million ($0.21) -82.71
Pacific Coast Oil Trust $32.19 million 2.00 $220,000.00 $0.04 41.76

Pacific Coast Oil Trust has higher revenue, but lower earnings than Range Resources. Range Resources is trading at a lower price-to-earnings ratio than Pacific Coast Oil Trust, indicating that it is currently the more affordable of the two stocks.

Summary

Range Resources beats Pacific Coast Oil Trust on 10 of the 16 factors compared between the two stocks.

About Range Resources

Range Resources Corporation is an independent natural gas, natural gas liquids (NGLs) and oil company. The Company is engaged in the exploration and production of natural gas, NGLs and oil in the United States. It is engaged in the exploration, development and acquisition of natural gas and crude oil properties located primarily in the Appalachian and North Louisiana regions of the United States. Its principal areas of operation are the Marcellus Shale of Pennsylvania and the Lower Cotton Valley formation of North Louisiana. Its properties consist of interests in developed and undeveloped natural gas and oil leases. Its properties in the Appalachian region are located in the Appalachian Basin in the northeastern United States, predominantly in Pennsylvania. The Company’s other operations include drilling, production and field operations in the Texas Panhandle, as well as in the Anadarko Basin of Western Oklahoma and the Nemaha Uplift of Northern Oklahoma and Kansas.

About Pacific Coast Oil Trust

Pacific Coast Oil Trust is a statutory trust formed by Pacific Coast Energy Company LP (PCEC). The Trust is engaged in acquiring and holding net profits and royalty interests in certain oil and natural gas properties located in California for the benefit of the Trust unitholders. The Underlying Properties consist of producing and non-producing interests in oil units, wells and lands located onshore in California in the Santa Maria Basin, which contains PCEC’s Orcutt properties, and the Los Angeles Basin, which contains PCEC’s West Pico, East Coyote and Sawtelle properties. The Underlying Properties consist of the proved developed reserves referred to as the Developed Properties and all other development potential on the Underlying Properties, which are referred to as the Remaining Properties. Production from the Developed Properties attributable to the Trust is produced from wells that, because they have already been drilled and require limited additional capital expenditures.

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